Wednesday, March 30, 2011

Universal Orlando ~ Up for Sale?

ORLANDO, Fla. -- One of Central Florida's biggest attractions may be sold.

The Blackstone Group, which owns 50 percent of the park, is offering up its stake. Blackstone first offered its share to NBC Universal, which owns the other half of the park.

If NBC Universal does not accept the offer, Blackstone could market the theme park to other companies. NBC Universal has until mid-June to decide whether or not to buy out Blackstone.

If the parks were to come under ownership other than by NBC Universal, it could bring some of the theme parks' licensing agreements into question.

Financial documents reveal that Universal Orlando has taken steps to ensure that licensing for the Wizarding World of Harry Potter would continue even if the park is no longer owned in part by NBC. However, if a new owner were not to follow specific rules, the license could be terminated by Warner Bros., which owns the Harry Potter franchise.

Universal Orlando also said this week that park attendance skyrocketed again in the final quarter of last year, increasing by 46 percent. Year-to-year, the parks said attendance was up more than 50 percent.

Robert Niles, editor of Theme Park Insider, said Universal Orlando is as valuable as its ever been.

"Blackstone kind of has Universal in a barrel here," Niles said. "Harry Potter's really boosted the attendance and the profit and the visibility of the Orlando resort."

Niles said it isn't likely that NBC Universal would let Blackstone start shopping with park to third parties.

"Universal Orlando has become too valuable to NBC Universal to have any risk of losing control of the property. They've really to to step up to the plate here and find way to accommodate Blackstone."
Niles said it is likely that NBC Universal will either try to buy out Blackstone completely, or provide them with a better incentive to stay.
"This is an opportunity for Universal to claim complete control of the resort…something they've not had up until this point," Niles said.
With the increased attendance from 2010 also came a big raise for the CEO of Universal City Development Partners, the name for the corporation that operates the parks.

In 2009, John Sprouls made $282,000, SEC documents show. But in 2010, Sprouls received $1,258,355. The increase was largely to more than $1 million in incentive pay, based on the parks' long-term growth plan.